Analysts see a judicial precedent in the New Hampshire state court ruling on Project LBRY tokens.
New Hampshire State Judge Paul Barbadoro’s ruling. rulingin which the court agreed with the U.S. Securities and Exchange Commission’s (SEC) arguments that Project LBRY tokens, LBC, qualify as securities, could have implications that could put all cryptocurrencies except bitcoin outside the U.S. legal framework.
The decision presented puts an end to the proceedings that the SEC initiated in March 2021. The court rejected all of Project LBRY’s arguments that LBCs are not securities as untenable. The court noted that LBCs were available to a wide range of investors and that the process of placing these assets in an ICO involved the involvement of an intermediary whose function is de facto akin to what an underwriter does when listing securities on an exchange.
Even the fact that LBCs were issued as compensation for the labor of project participants, without the promise of an increase in the price of those tokens, was not taken by a U.S. court as a possible counterargument to the SEC’s claim. The court rejected LBRY’s claim that LBC had any useful consumer properties and was a utility token.
The case has been covered in U.S. news broadcasts on FOX, and legal experts in the U.S. say the LBRY decision could be used as precedent in the verdict against Project Ripple’s XRP cryptocurrency. Moreover, such precedent increases the legal risks against the largest altcoin by capitalization, Ethereum, as well.
With regard to bitcoin, experts remain silent, given that the U.S. authorities have not yet declared any formalized legal claims on the oldest cryptocurrency. At the same time, the concept of the existence of bitcoin mining, presented by the U.S. White House, puts forward The concept of bitcoin mining presented by the U.S. White House has overstated environmental requirements for this activity, which by itself could potentially make it impossible for a significant number of miners to operate in the U.S.